Impairment loss allowance on performing assets

Impairment loss allowance on performing assets

Should impairment loss allowance be provided on performing assets or standard assets at the time of recognition of such assets?

The expected credit loss is required to be applied on day one for all types of financing assets. The expected credit losses are the present value of all cash short falls over the expected life of the financial instrument. The credit loss is the difference between all contractual cash flows that are due to an entity as per the contract and all the cash flows that the entity expects to receive, discounted at the original effective interest rate. As per the new impairment model, impairment losses should be recognised even for financial assets that are newly originated or acquired.

Ind AS Accounting Standards

Ind AS Accounting Standards

Key takeaways from the RBI notification dated 12th Nov 2021

How is the expected credit loss measured

Treatment of collateral value for expected credit losses

What are the three stages of impairment loss

Simplified Approach for ECL for trade receivables

Recognition of interest revenue during all three stages

What is meant by significant increase in credit risk

Impact of impairment requirements on first-time adoption

Approaches for assessing credit risk

What is the new Expected Credit Loss Model

Presentation of impairment loss for debt instruments at FVOCI

Impairment for debt instruments classified as FVOCI

New impairment methodology